Fed Will String Traders Along on Its Taper Timeline
The Bank of Canada may be trimming its asset purchases, but U.S. central bankers are giving themselves ample wiggle room to see how the economy evolves.
Playing it close to the vest.
Photographer: Susan Walsh-Pool/Getty Images
Want to know when the Federal Reserve will begin tapering its bond purchases? It seems easy enough: Just figure out what Chair Jerome Powell means by the word “string.”
“We want to see a string of months like that so we can really begin to show progress toward our goals,” Powell said earlier this month in response to a blockbuster March employment report. The word is generally defined as a sequence of similar events — in this case, monthly gains of a million jobs. San Francisco Fed President Mary Daly, reacting to the blowout March retail sales report, reiterated the need for “repeated months of this before we can distinguish optimism about the future from the realization of the future.”